medium · Market Microstructure mmf-core
A 'spoofing' trader wants to buy 10,000 shares of a stock currently quoted at $50.00 bid and $50.02 ask. They place a large fake sell order for 50,000 shares at $50.01, causing the bid to drop to $49.95.
If the trader then buys their 10,000 shares at $49.96 and cancels the fake order, how much did they 'save' compared to buying at the original ask?
- $500
- $400
- $600
- $5,000
Sign up free to see the explanation and track your rank →
More Market Microstructure mmf-core practice
- A stock is trading at $100.00. The Level 1 S&P 500 Market-Wi… — What is the status of trad
- If the stock gaps down and opens at $69.50 on Tuesday morning, at what price will the trad
- Using the Lee-Ready algorithm, how should a trade occurring at $50.10 following a $50.00 t
- During the pre-open period of an opening auction, the exchan… — What is the primary purpos
- If a stock enters a 'limit state' and does not recover within 15 seconds, what is the regu
- A retail trader hears a stock tip on a popular social media… — How is this trader classifi
- A corn farmer is worried that prices will drop before the harvest in three months. The far
- What is the clearing price that maximizes volume?